The Graying of Michigan’s Lawyers

Most students entering law school in 2012 will graduate in 2015. By then, a significant demographic factor will come into play regarding the job market. That factor is the aging Michigan lawyer.

More than half of Michigan’s active resident lawyers are 50 years old or older. And Michigan data show that more lawyers are leaving the practice of law in Michigan than the law schools produce.

The result is that, starting very soon, Michigan will not produce the number of law school graduates sufficient to replace the number now leaving the profession through retirement, death, and other employment.

This portends well for job growth in Michigan.

The Premise for This Analysis

The premise of the following analysis is fairly simple: Michigan will not produce the number of law school graduates sufficient to replace the number now leaving the profession through retirement, death, and other employment. A good way to think about this globally is to consider it the reverse of the much-discussed coming social security crisis brought on by the burgeoning retirement of the aging baby boomers. They are beginning to retire in large numbers, and while each retiree becomes a social security burden, each one leaves a job and contributes to a growing demand for replacement employees. Some of those needed replacement employees, of course, will have to be lawyers.

The Source of the Data

This analysis will focus on Michigan and is based on data taken from a 2011 three-part demographics report issued by the State Bar of Michigan using 2010 data. The report looks at the Michigan lawyer membership by age-group, with the demographics in the report based upon the age profile in 2010. According to the report, in 2010 there were 33,492 active Michigan resident members of the Michigan bar. The members of the bar are now one year older, but this analysis will not take that into effect except as specifically noted.

More Than Half of Michigan’s Lawyers Are 50 Years Old or Older

Among active Michigan resident members, 11.1% were born before 1944 (these 3,716 lawyers are called “traditionalists” in the bar report). Another 42.3% were born in 1944-60 (the 14,155 so-called “boomers”), meaning that a combined 53.4% were born before 1961. The youngest of the traditionalists will be 69 in 2012. The youngest of the boomers will be 52.

According to a more detailed breakdown of the age cohorts elsewhere in the State Bar report, 55.6% of the active Michigan resident members were 50 years old or older in 2010. The Bar reports that 9,918 members are 60 or over, which is 29.6% of its active members. Another 8,724 active members are in the 50 to 59 age group, constituting another 26.0% of the active membership in Michigan.

The implications of this aging membership for the job market are significant, if not alarming. Over the next twenty years, most of these lawyers will be gone from practice. And, presumably, most of those who were 60 or older at the time of the State Bar’s report will retire in the next ten years.

That means that as many as 9,918 lawyer replacements will be needed within a decade (this presumes that the number who will not retire will be balanced by about the same number of those in younger age categories who will leave membership). For the 60 and over group, the assumption is that about one-tenth will retire each year beginning in 2011. So, on average, about 992 lawyers will be needed each year in the next decade, just to replace these older lawyers.

Another 8,724 lawyers were age 50 to 59 at the time of the survey in 2010. Assuming that these lawyers are evenly spread within this ten-year cohort, about 872 are in each year’s group. Further assuming that each group will retire at age 67, the first of this group will reach retirement in 2018, adding about 872 lawyers per year to the 992 lawyers from the older group for approximately a three-year period, meaning that the demand will grow to 1,864 for the years 2018 to 2020.

An alternative calculation would be that over the next 20 years, we will need 18,642 new lawyers just to replace the current members leaving practice due to age. That is an average of 932 per year.

Another study established that Michigan experienced its heaviest periods of bar admissions in the years between 1975 and 1994. In that twenty-year period, new admissions by examination totaled 22,409, with 11,746 in the first ten-year period and 10,663 in the second. The first of these increased admissions reaches its 40th anniversary in 2015. Given that the average age of lawyers passing the bar is approximately 27, heavy retirement numbers can be expected from this group. Needed replacements will average 1,175 for the first ten years and 1,066 for the second ten years. On average over the twenty years after 2015, Michigan will need 1,120 new lawyers to replace those admitted in between 1974 and 1994.

More Lawyers Are Leaving the Practice Than the Schools Produce

Under either alternative, more lawyers will be leaving active practice than the schools currently produce or have produced over the past fifteen years. The aging Michigan lawyer population leaves a legacy of jobs for those about to enter law school. The opportunities are widespread with 65 of Michigan’s 83 counties showing a lawyer population of 50 years or older that is above the state average, and with 55 of the counties having 60% or more of their lawyers who are at least 50 years old.

Contrary to the assertion that there are too many lawyers because the law schools are now producing too many graduates, and consistent with the fact that new admissions by examination in Michigan have declined significantly throughout the past fifteen years, Michigan’s active resident lawyer population consists of lawyers who are 40 and over and is dominated by those who are 50 or older. The current Michigan resident member population includes only 21.8% who are under 40 years of age, and those under 30 are only 4.6% of the Michigan lawyers. Even in the counties with law schools, the percentage of lawyers under 40 is low: Ingham with two law schools is at 25.0%, Kent with one law school is at 24.8%, Oakland with one law school is 22.7%, Washtenaw with two law schools is at 19.6%, and Wayne with two law schools is at 22.6%.

These demographics, and others to be discussed in later blog posts, portend job growth for lawyers in Michigan.